A vast majority of Americans have absolutely no clue how advanced China has become. Look at the social media comments, and it’s clear that too many Americans – especially Trump supporters – are filled with misinformation and prejudice. “China is 100 years behind” … “All Chinese products are crap” … “China can’t innovate” … “It’s a communist, poor, polluted country” … and, of course, the most popular theme is “China’s economy is about to collapse.” It’s hard to change these opinions, since those people reinforce their biases by gleefully consuming and sharing only anti-China articles. Anything remotely positive about China is attacked as “Chinese propaganda.”
This potent mix of ignorance and hubris is also precisely why western corporations gladly and voluntarily shared their intellectual property (IP) with their Chinese joint-venture partners. The term “forced technology transfer” was invented retroactively only after Chinese corporations started threatening western profits — for example: Huawei has overtaken Apple, Nokia and Ericsson in smartphones, 5G and telecom infrastructure; BYD manufactures more electric vehicles than Tesla; Alibaba and Tencent process 50x more mobile payments than the US; and the most valuable (ByteDance) and the most innovative (Meituan) startups are Chinese.
While it’s true that China as whole has a long way to go in GDP-per-capita, many big cities in China are essentially “developed economies.” Plus, China has surpassed the US in many areas and is catching up in others.
If you don’t know your competitor, you’re certain to lose the game. So here are some quick statistics on China’s global leadership:
Economy, Manufacturing, Trade
=> #1 in PPP GDP (been so since 2014 when it surpassed the US)
=> #1 in exports (been so since 2009 when it overtook Germany)
=> #1 in container traffic (40% of global market). 7 out of the Top 10 busiest seaports are in China
=> #2 importer ($2.1 trillion)
In spite of coronavirus/COVID-19, China’s manufacturing continues to grow and accounts for 28% of global manufacturing. In fact, China is as big as the US, Japan and Germany combined.
=> #1 in foreign exchange reserves (>$3 trillion)
=> #1/#2 holder of US debt (>$1 trillion)
=> #1 banking system (twice the size of the US, in terms of assets). Surpassed the EU in 2016.
=> #1 trade partner for 130 countries (trade = exports + imports). And for 37 countries, China is their #1 export destination (meaning, they sell the most goods to China).
=> #1 in contribution to global GDP growth for the past decade (25-35%, which is twice that of the US). That is, if the world GDP grows by $100, then $25-$35 comes from China.
=> #1 in electricity generation (link)
=> #1 importer of crude oil (link)
=> #1 in purchase of industrial robots, accounting for almost 40% of global market in 2018 (link)
=> #1 in manufacturing of conventional cars (>26 million per year)
=> #2 in hi-tech manufacturing (Yeah, China isn’t just making t-shirts anymore)
=> #2 in billionaires (about 400 billionaires)
=> #2 in millionaires (5 million millionaires)
=> #2 stock market, by market cap (overtook Japan in 2014)
=> #2 bond market, worth $16 trillion (link)
=> #1 in representation in Global Fortune 500 companies. (surpassed the USA in 2020). The chart below is from 2019. By mid-2020, mainland China had 124 and the US had 121 companies.
=> #1 in production of rice, wheat, potato, beer(!), tea, apple, strawberry, grapes and numerous other grains, vegetables and fruits. (link)
Poverty Reduction and Growth of Middle Class
=> #1 country in the wealthiest Top 10% of global households (overtook USA). Now there are 100 million Chinese worth $110K or more.
=> #1 in poverty elimination (800 million lifted out of extreme poverty). Extreme poverty will be practically 0% in 2020.
=> #1 in online/e-commerce retail sales (3x the US)
=> #1 in personal luxury goods sales (35% of global market)
=> #1 luxury car market (Example: 400,000 BMW’s manufactured and sold in China in 2017)
=> #1 in international tourism spending (In 2010, Chinese tourists spent half as much as Americans; and by 2017, China was spending twice as much as the US)
=> #2 in Unicorns (startup companies worth more than $1 billion). 142 in China versus 175 in US. In 2020, the number of Unicorns are 227 in China versus 233 in the USA). Interestingly, 16 Unicorns in the US were founded by Chinese immigrants or Chinese Americans.
=> #2 in venture capital funding ($100 billion of new venture capital funding for about 2,900 startups last year )
=> #1 in e-commerce (42% of world market)
=> #1 in 4G mobile network (2 billion users)
=> #1 in smartphones (Chinese brands have 50% of the global market)
=> #1 in solar, wind and hydroelectric power (link)
=> #1 in electric cars – manufacturing and sales (link)
=> #1 in consumer drones (70% of global market)
=> #1 in supercomputers (227 out of the 500 supercomputers are Chinese)
=> #1 in mobile payments (50x larger than the US)
=> #1 in skyscrapers – more than half of all skyscrapers are in China (link)
=> #1 in high-speed rail or bullet train (35,000 Km or 22,000 miles by the end of 2019) (link)
=> #1 in global infrastructure projects. China’s Belt and Road Initiative (BRI) involves 152 countries and international organizations. (link)
Science, Research & Development
=> #1 in patents — accounting for almost half of all patents in the world!
=> #1 in science, technology, engineering and math (STEM) college graduates (4x as many as the US)
=> #1 in scientific publications since 2016. And also catching up on the Top 10% and Top 1% of these papers/articles. (link)
=> #1 in the world in math, science and reading proficiency among high school students
=> #2 in number of satellites in orbit/space (280 satellites as of 2018). In 2018, China became the first country to land on the far side of the moon. In both 2018 and 2019, China was #1 in rocket launches.
What should the US do? Try to “contain” China? Start World War III to maintain our global hegemony? Become depressed and paranoid? Thankfully, the answer to all those questions is, “NO.” There are constructive things that America can and should do to prepare for the future. I will discuss those in my next article.